TABLE OF CONTENT
CHAPTER ONE
1.0 Introduction 1
CHAPTER TWO
Review of literature 11
2.1 The nature and scope of audit 11
2.2 The historical development of audit 12
2.3 The objective of audit 14
2.4 The essential features of audit 17
2.5 Summary of related literature reviewed 18
CHAPTER THREE
Research Methodology 20
3.1 research design 20
CHAPTER FOUR
Data presentation and results 24
4.1 Summary of results/findings 29
CHAPTER FIVE
5.0 Discussion, implication, recommendations 31
Reference 37
Appendix 38
CHAPTER ONE
1.0 INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The cradle of business organisation revealed that most business set ups were managed by their owners. The ownership manager was the financial provider and contribution to the enterprise, but with the advent of large scale production and development in scope and in scale of business, a huge capital beyond that affordable by the sole proprietor or family was needed.
Consequently, contributors, hereafter called shareholds were required to raise the fund for the business.
The invitation of these shareholders led to the separation of the owner managers from the management of the business. This is because all of them cannot, be the directors of the business at the same time. As a result of this the management of the business was entrusted in the hands of people who have no financial claims to the business. The law denies the shareholders access to the books of account of the company, depriving them of their rights to be kept abreast of the director’s performance. The shareholders became skeptical about this. Thus, the need of effective surveillance over the activities of the non-owner managing directors.
Basically, in an attempt to satisfy the shareholders, the services of an auditor, who will serve as the third party in auditing the account of the business were needed and employed.
The study revealed that the job of this auditor is to check whether the accounts present a true and fair view of the business’ transactions and also to ascertain the reliability of the records from which the accounts are drawn as well as verifying the assets and liabilities including petty and negligible transaction within the accounts.
The study also brought it to the light, that the company should be discreetly structured so as to facilitate full and proper enhancement and attainment of accountability.
Audit has since received a lot of definitions and or interpretations both from accounting bodies and authors. Consultative council of accountancy bodies CCAB – defines audit thus: The independent examination and expression of opinion on the financial statement of an enterprise by an appointed auditor in pursuance of that appointment and in compliance with any relevant statutory obligation. The general essence of audit is to ascertain compliance of the company’s records and operational polices with certain prescribed standard. It aims also at increasing the usefulness of acceptability and dependability on the firm’
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